This commentary is by Andrew K. Gentile of Sheffield.
The new Village Center Apartments in Morrisville were built to be affordable housing for low-income earners and the homeless, however the price tag of $7.9 million is hardly affordable by almost any housing standard. The brand new, deluxe building has 24 apartments, most too small for a family. There are seven studios, 13 one-bedrooms, and four two-bedrooms. If all the apartments are treated as an equal percentage of the building, their per-unit value would be $329,167, more than the average cost of a two-bedroom house with land in Vermont.
The unit sizes were not given on the Evernorth website, but if we assume typical apartment sizes, the square footages per unit would be approximately 600, 900, and 1200 respectively for studio, 1BR, and 2BR, making the construction cost $382 per square foot, or 170% of the average cost of construction for a single family home in Vermont. It would have been cheaper to have purchased twenty-four single-family homes with land.
Not to be outdone by the Morrisville taxpayer largesse, the Packard Court Units in St Johnsbury, also designated as low-income housing, are expected to cost $450,000 each, about the same cost as a nice condo in downtown Boston. And just like the Morrisville gaffe, the Packard Court apartments are also too small for families. Out of thirty units, twenty-one will be studio apartments and nine will be one-bedroom. Again, if we use estimated sizes for studios and one-bedroom apartments, the cost of construction would exceed $600 per square foot, possibly the most expensive construction in the state.
Subsidized housing is big business in Vermont. Taxpayer money is being used to fund housing that few working Vermonters could even afford. And why not? From an investment standpoint, there is no downside. It’s a great investment with almost no risk and state-guaranteed rents. There is money to be made in homelessness.
Motels all over the state are pitching in to help the homeless. According to the Caledonian Record, from January to October 2022, the Fairbanks Inn in St. Johnsbury grossed $1.8 million and the Colonnade Inn in Lyndonville grossed $850,000. These are not particularly nice motels, yet due to the limitless generosity of the state, they have been transformed into cash-machines and are able to maintain near 100% occupancy while charging prime rates up to $180 per night. Participating motels gorging themselves on state vouchers are probably making at least double what they made as motels.
This is a tax-funded feeding frenzy, and you are fooling yourself if you think this is temporary. We are witnessing the birth of the new, highly profitable homelessness industry. And although these housing programs are often advertised as helping “Vermont families,” consider that only four of the fifty-four apartments available between Village Center and Packard Court are large enough for a family. More than half are studios. These subsidized units are for single people.
The dollar amounts are staggering. The state pays nearly $60,000 per year to house just one homeless person in a motel. This is just for housing, not including health care and/or food benefits. To support an investment like the Morrisville apartments, the unsubsidized rents would have to be in the area of $3,500 per month for a one-bedroom. The Packard Court apartments would be more like $4,500 per month. This, of course, is not what residents will pay; this simply represents the market values of the units. Very few working Vermonters could afford to live in an apartment worth $450,000.
To put these bloated costs in perspective, it costs $35,998 a year for a student to attend UVM, and that includes food, housing, and a college education. If you want a bullet-proof measure of just how poorly these programs are being run, consider that it would cost half as much to give a homeless person a college education at UVM — including food and housing — as it would to support them through Vermont’s motel program. Where is all the money going?
Homelessness is a serious condition that needs to be addressed, but mostly it is a symptom of underlying financial problems. Permanent and excessive subsidies are not the solution; they are just allowing the underlying problems to continue and to worsen.
Unfortunately, there appears to be no amount of spending to which the Vermont legislature would say, “Sorry, we can’t afford that.” It is no wonder homelessness is increasing in Vermont. This won’t end well. It might not even end.
